After five years of negotiations, Pfizer has decided it’s time to move employees at plants in Ireland to the same pension plans that the rest of the company’s employees have. That decision comes despite the threat of a work stoppage.
In a statement today, Pfizer said it will move the roughly 900 employees from defined benefit pension plans to defined contribution plans where employees participate in funding their own retirement savings. The April 1 move includes additional payments to employees by Pfizer as recommended by Ireland’s Labour Court.
“Pfizer is disappointed that the outcome of the union ballots support industrial action, which is disproportionate. Pfizer has accepted the Labour Court recommendation which includes enhanced terms and transitional arrangements.”
The workers last month rejected the proposal of Pfizer and an Irish Labour Court and approved work actions for this month. Most of the holdouts work at Pfizer plants in Ringaskiddy and Little Island in County Cork, with the rest employed in shared services and commercial operations in Dublin.
After the rejection, the union said it plans a 24-hour work stoppage in the Ringaskiddy facility on Feb. 15 followed by a 24-hour work stoppage in both plants on Feb. 18, the Irish Examiner reported.
As part of the enhanced terms, workers over the age of 50 will be allowed to keep their current pension plans until they retire and the rest of workers between the ages of 35 and 50 have them phased out over three, five and seven years. In addition, the court recommended that an initial lump sum of €10,000 be paid to the workers to “reflect that future pension arrangement will be contributory for members,” stipulations that Pfizer also accepted.
Pfizer has pointed out that its cost to fund its so-called defined benefit pensions, in which employees make no contribution, have gone up 1,000% since 2009 “and these costs are affecting the competitiveness of Irish operations.” It said that its remaining 1,400 workers in the country have already made the change over to direct contribution plans.